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Despite the harsh business environment in Nigeria, the construction sector contributed N12.9 trillion to the Gross Domestic Product (GDP) in the first three quarters of 2022, a report by the National Bureau of Statistics (NBS) has revealed.
Besides, the report states that the real estate sector also contributed N7 trillion to the GDP in these quarters.
According to the report, the construction sector contributed 9.5 per cent to the nominal GDP in the third quarter of 2022.
This percentage, it said was higher than the 9.26 per cent it contributed a year earlier and higher than the 7.95 per cent contributed in the second quarter of 2022 and also grew by 18.92 per cent in nominal terms (year-on-year) in the 2022 third quarter.
Compared to the rate of 47.67 per cent recorded in the same quarter last year, the sector however dropped 28.75 per cent points
Real estate services in nominal terms, according to NBS grew by 9.13 per cent, higher by 0.50 per cent points than the growth rate reported for the same period in 2021 and lower by 3.68 per cent points compared to the preceding quarter.
Quarter-on-Quarter, the sector growth rate was 16.38 per cent. The contribution to nominal GDP in Q3, 2022 stood at 4.96 per cent, relative to 5.27 per cent recorded in the third quarter of 2021 and higher than the 4.95 per cent accounted for in the second quarter of 2022.
The NBS calculates the sector’s contribution by adding up gross outputs such as a sum of fees, the value of work done, commissions receivable for the services rendered and other incomes.
It also considers intermediate consumptions such as details of the cost structure including transportation fees, operational expenditure, minor repairs and maintenance etc.
Talking about what can be done to improve activities in the sector, the Managing Director, Dutum Properties Limited, Tope Runsewe, said that there was a need to develop a thriving mortgage system.
Besides, he stated that government would need to fix the economy, fix inflation and the depreciating nation’s currency.
He believes there is much potential in the real estate sector if developed.
He explained that except the nation’s mortgage system is developed, it would be difficult for developers to construct more houses to bridge the 27 million accommodation gap in the country, due to the low purchasing power of people in need of housing.
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